Gujarat Pipavav Port revises expansion plan

Gujarat Pipavav Port

-PV News Bureau

Gujarat Pipavav Port Ltd has revised its expansion plan which envisages an increase in container handling capacity from the present 0.85 Million TEUs to 1.35 Million TEUs as against 1.5 million TEUs as originally planned. The bulk capacity will remain constant at 4-5 million mt as against the earlier plan of increasing it to 20 million mt. The revised capex of Rs 4,600 million will be implemented in a phased manner.

The revised plan consists of:

-Purchase of three Post Panamax cranes to replace three existing Panamax cranes.
-Strengthening of existing Berth three.
-Dredging of Berth Pockets.
-Phased container yard development.
-Purchase of four rubber tyred gantry cranes.
-Development of internal roads and gate complex.
-Electrical and other allied works.
-Post expansion bulk capacity will remain at 4-5 million mt and liquid capacity at two million mt.

The Initial plan basis Environmental Clearance was obtained in June 2012 and scheduled to commence in Oct 2013. It was timed to sidestep the monsoon season, which prevents large-scale construction/ dredging on the seaside. The subsequent reissuance of the Environmental Clearance came at a time immediately preceding the 2014 Monsoon season, an internal assessment forecasted an inordinate delay if the initial plan was to be implemented as is – with commercial implications on the container business, which is presently near 80% utilization levels.

A simultaneous but pertinent development was an increase in Indian Railway’s tariffs on bulk commodities. The distance slab based rail freight classification proved more expensive for some of its up country customers on select routes vis-à-vis competition, coupled with the documented delays in commissioning of coal based power plants around Pipavav – prospects on the expanded bulk capacity were unclear in the immediate future.

Basis the above, various scenarios were explored and a new plan evolved, the existing Berth three was to be strengthened and its three panamax cranes at the end of their life cycle replaced with three post panamax cranes. However as an existing jetty was being modified, the parameters only allowed an expansion to 1.35 Million TEUs, vis-à-vis the initial plan of 1.5 million TEU – justified by the fact that nearly the same capacity was being made available, in nearly the same timeframe and at a cost that is over 50 per cent lesser than the initial plan. The revised plan will see the expanded capacity come on stream in CYQ1 2016 as against CYQ4 2015 as originally envisioned.

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